Managing a crisis where everyone is affected

We often get involved in crises on behalf of our clients. These include events where products malfunction, or employees do something they shouldn’t. Our task is to help manage the communications fallout and hopefully ensure the client’s business doesn’t suffer. The current swine flu crisis puts governments at the center of a horrible crisis. In most crises, there are certain parts of the population that are affected and a majority that aren’t. That majority are the spectators and they react to the crisis as spectators. In the swine flu crisis there are no spectators. Everyone is a potential participant. This changes the dynamic considerably. It means we consume the information our governments and organizations like the WHO disseminate in a different way. We are not dispassionate or even rational. Instead we are concerned, cautious and emotional. We want to hear that we will all be fine but we also want to know what is going on in great detail. The latter, will of course create more fear than comfort. This leaves governments and health groups with a ‘balance’ challenge. How much do they say and how grim a picture do they create? This challenge is exacerbated in a pandemic situation where the media and Internet make it easy for us to see the difference between how say the Spanish are dealing with it versus the Americans. If one government paints a bleak view while another tries to keep people calm, the public is going to be confused and naturally skeptical of the communication they are getting. Getting governments to behave in a consistent manner is almost impossible as we have seen on issues such as global warming. This leaves the WHO as the one common mouthpiece in all countries. Again, however, the gap between what they say and a local government says will be consciously or subconsciously watched by people the world over. I don’t envy the people handling this crisis it one that we are all watching and are all concerned about. I only hope the real crisis goes away and makes their jobs a lot easier.

WPP and Omicom post poor PR results for Q1 – why?

The two largest marketing services companies in the world, Omnicom and WPP, posted poor results this week for their first quarter activities. Both saw some significant declines in revenues and both pointed to weakness in their PR businesses. In normal times I’d take some pleasure in such results but in these times I don’t. I’d prefer to see an industry that is proving resilient in this economy. Of course you could argue that the drop in PR sales is to be expected given the overall slump in the economy. You could also argue that PR is doing relatively well. Unfortunately in both cases, they made the opposite point – namely that PR was actually doing worse than some other disciplines such as advertising. This really makes me scratch my head. When marketing budgets are tight it doesn’t make sense to spend on advertising versus PR. Every piece of data I’ve seen says PR is more cost effective than advertising. So why are some companies doing this? Here are the reasons I can think of:

1. Ad agencies are doing a better job of showing their digital credentials
2. Ad agencies are doing a better job of using metrics to show the effectiveness of their campaigns
3. Ad spend may have been committed in Q1 and therefore harder to cut than discretionary PR projects
4. Some businesses may have already cut advertising out of their mix, thus leaving PR as the only real choice
5. Of course it could also say something about their PR agencies versus their ad firms

Put another way I wonder whether the Q2 sales of these groups will be more revealing in terms of real trends in PR versus advertising. I guess we’ll see.

PR Week doesn’t make the industry better

The poll I ran on this blog, while hardly scientific and hardly shocking shows that most of you don’t think PR Week makes the industry better (38% said it makes it better versus 61% who said it doesn’t – I have no idea what the other 1% think). At a time when the industry needs help this is rather disturbing. PR Week does have some rivals in terms of trade press but it is the most visible and the best funded. The publication will be changing soon as a new editor comes in. One assumes that Julia Hood, who oversees the publication will use the change in editor to also change its direction. I for one would love to see the publication focus more on giving the industry an insight into trends in PR and what products and services clients are demanding and for it to worry less about telling us who won what account. While the latter is interesting it does little to advance the state of PR. Now some of this would require the publication to invest in proper research and give reporters time to write truly insightful features on say the impact of social media in a downturn for consumer companies.

I appreciate that what I’d like to read about in PR Week may not suit all the readers but I think the publication should start by asking itself some pretty basic questions such as: what role should PR play in business in the next five years and how different is that from the role it plays today? From answers to this and other questions it could then look at what needs to be done to help the industry get there. This needn’t result in the publication simply being a cheerleader. It can still be critical and indeed it should be critical where the industry doesn’t evolve as it should. What is clear though is that the publication needs to develop a clear voice on certain key issues, issues that are central to the future of the industry. Being a spectator may be fun but it does little to really help. At the end of the day PR Week is a part of the industry and holds a position that should enable it to help lead the industry forward. I’d love to see it take up that position because if it does it will benefit the whole industry and may even make itself a bit more money along the way.

The role of social media in decision making

Social media has a wider role than simply enable decisions but for PR people its role in decision making is critical. If social media influences the decisions people make then PR people need to influence social media. But we cannot, and shouldn’t in my mind simply look at social media as an island when it comes to that influence. Instead we should look at where social media sits in the decision process and make sure we are therefore influencing all aspects of the chain. Below is a simplified version of that chain that I’m throwing out for others to develop further:

Stage 1: Information. This phase of decision making is the foundation upon which everything gets built. If certain facts, data and events are used as a foundation it will greatly influence the decisions that are made. Public Affairs practitioners are well aware of this and will often war on the facts that should form the basis of a topic.

Stage 2: Content. The content phase is where perspective, relevance and color are added to the information to make it clear why someone should be interested and to try and get people interested. This is the role of those in the media and of those in social media.

Stage 3: Conversation. This is where content is discussed, tested, shared and debated. This is where traditional media has struggled and where social media has claimed significant victories. Of course who shares content, the questions they pose and the additional facts/data they introduce are all relevant to the role these conversations have in decision making. Interestingly I’m struck by the fact that even in social media where conversations are meant to be open to all, they tend not to be. Bloggers will respond only to certain people, there are certain people who Twitter (The Twitterati) whose notes matter more.

Stage 4: Decision time.

Of course there will be subsets to the above and points in the chain where people will loop back to gain new information, add new perspectives and so forth. But if you think of this as a decision pyramid you can see that ultimately he stages of Information, Content and Conversation are what lead to decisions.

Anyway, I’d welcome people’s thoughts on this decision pyramid concept. It needs a lot of work to be completed but I think PR people need to start to articulate to their clients or CMOs the role social media plays in a far better way than is done today. Social Media is not a separate area of comms it is critical part of the decision making process.

Goldman Sachs doesn’t see a bonus in TARP

Goldman Sachs today announced strong first quarter earnings and its intention to raise $5Bn so that it can start to pay off its TARP funding. You have to wonder if the motivation to get out of TARP, is executive pay. Banking conditions haven’t really improved much in the last month or two and almost all the banks have taken TARP money, so why the rush to pay back the government? It isn’t as if banks with TARP money are considered inferior. The only conclusion I can draw is that Goldman Sachs execs hate to see the bank making such huge profits (they just made $1.8 Billion dollars in the last quarter) and not being able to pay out huge bonuses to themselves (I wonder how much profit they would have made if they’d been allowed to pay bonuses and salaries as they did before TARP?). Goldman will need approval from the regulators to pay back its TARP money. Hopefully the first real question they ask is: “Why do you want to pay it back so soon?” I also hope they listen really carefully to the answer. It would be a tragedy if Goldman Sachs paid back its TARP funding and then simply carried on as if nothing had happened. It would be an even bigger tragedy if that then resulted in them getting right back to where they were before the TARP funding.

The social media triangle

I noticed Andy Lark’s latest tweet this morning, referencing his latest blog entry, which in turn referenced another blog entry. It occurred to me that the only thing missing here was a link to a Facebook page and then the social media triangle, as I’d like to call it, would be complete. It seems that one of the keys to doing good social media PR is to generate content on a blog or on a community site like Facebook and then link to it via another blog or community site and then top it off with a quick reference on Twitter for those of us who can’t keep track of all the blog posts and Facebook entries people make these days.

What does strike me as interesting in this triangle is:

1. That there is no dominant blogging platform in the way Facebook dominates the community space
2. That Twitter is becoming a great way to quickly see all the social media content changes that people have made that may have value

Scobleizing Twitter

Robert Scoble made a name for himself as a pioneer in the blogosphere. At the time he was a Microsoft employee and he demonstrated how blogging could help large corporations have a more intimate dialog with parts of its customer base. Since he left to focus on being a blogger and general industry pundit he’s been a man in demand, though he recently stepped down from his role at Fast Company ‘to pursue a new venture.’ Nobody can say that Scoble is a slouch when it comes to generating content. His blog seems to average three posts a day and his Twitter updates seem to occur every hour and often every few minutes, which brings me to my beef. Either Robert Scoble needs to eliminate 90% of his Twitter comments and turn them into blog entries, or he needs Twitter to create a longer format than 140 characters just for him so he can condense his updates and send them every few hours. As it stands when I open Twitter all I see are comments form him and the occasional comment from Brian Solis. Given Twitter also suffers from almost daily overloads I can’t help but wonder how much of that is because of people like Robert Scoble. For those of us that like Twitter, please back off Robert – you’re overloading the system.

Car industry needs PR

Context Analytics recently published a paper showing that for certain brands PR was way more effective than advertising. The brands most affected were those which had ‘high involvement’ products such as computers. High involvement products are ones where consumers typically do quite a bit of research before they make the purchase. I’d put cars firmly into that category and yet unless I’m blind I’d suggest that most car makers have done a pretty poor job on their PR. Instead they seem determined to convince people using TV adverts that they should rush out and buy their new vehicle. I’m of course basing this thesis on little real science. I did do a Google news search on major car brands and if you ignore all the bad articles about how deeply troubled the industry is, you see little that appears to be the result of a PR campaign.

A great example to me of a missed opportunity is Toyota’s launch of the new Prius. The car doesn’t go on sale until ‘late Spring’ but it is already on the Toyota website. Given how popular this car is I’d have expected there to be a lot of PR outside the traditional trade press. As yet I’ve seen nothing and as Prius owner (or Pious as a friend of mine calls them) I tend to notice when images of the less than attractive vehicle appear in the paper.

For the record then I’d strongly advise GM, Ford et al to forget their expensive ads and focus on getting the argument across using the media and social media. Assuming Context’s study is accurate, they’ll spend less and sell more.

Some people never learn

One of the Next Fifteen agencies just won a good piece of business. When the client called the losing finalists for the business, one of the firms was gracious and thanked the client for allowing them to take part and said they knew the agency they had chosen was a good firm but that they were obviously disappointed to lose etc. The other losing firm was much less gracious and told the client they’d made a bad choice etc. Guess how the client reacted? You got it. The client thought the first agency was professional and would certainly consider them for any future work. They thought the second agency was rude and arrogant and someone they’d never again consider.

This isn’t the first time I’ve heard such a tale. In every case the agency that takes defeat badly suffers even more in the long run. Meanwhile the ones who are gracious keep doors open for the future. Is the lesson really that hard to learn?